Mediation Bill: Not getting the Act together

While it contains many pluses, the Bill needs improvement in some crucial places

December 08, 2021 12:15 am | Updated 12:20 pm IST

Communication, two people disagree

Communication, two people disagree

Over the last 15 years, the dispute resolution landscape in India has undergone significant change with the advent of mediation. To house this consensual creature in the same stables as thoroughbreds of adversarial litigation and arbitration was a challenge, and even more to ensure that they got on reasonably well, working in tandem in inventive ways like arbitration-cum-mediation and vice versa.

It seems to be the way of the world that when something becomes prominent, there must be a law to regulate it. And so with mediation. While scattered mention was made of its use in several statutes, including commercial and consumer disputes, there was no comprehensive statute providing for all dimensions of the mediation process and its practice. Such a need was articulated in several quarters, notwithstanding doubters and dissenters who insist that regulation will kill the free spirit that mediation embodies. A group of senior mediators was set up by the Supreme Court Committee in charge of court-annexed mediation process, and over a period of several months, a draft Bill emerged which then started to make its way through the labyrinthine processes of governmental and legislative mandarins. The resultant Bill titled the Draft Mediation Bill 2021, slated for presentation now to Parliament, bears no resemblance to the original in some crucial places. It reminds the mediation community of an old Clint Eastwood film — the Good, the Bad, and the Sad (tweaked).

The good

The Bill recognises that mediation has come of age and needs to be treated as a profession, which is a huge improvement over the part-time honorarium basis it has in the court-annexed mediation schemes. The Bill acknowledges the importance of institutes to train mediators, and service providers to provide structured mediation under their rules. It provides for pre-litigation mediation. This is quite a remarkable step, but is designed to be easy to implement. Parties are required to have at least one substantive session with the mediator where the process is explained to them. Thereafter they are free to continue or terminate the mediation and follow the litigation path if they so decide. Further, if any urgent interim order is needed, they can bypass mediation at the first stage and return to it after resolving the interim relief issue.

Another plus is that the Bill does away with the confusion emanating from using both expressions “mediation” and “conciliation” in different statutes by opting for the former in accordance with international practice, and defining it widely to include the latter. It recognises online dispute resolution, a process that is going to move mediation from the wings to centre stage in a world that COVID-19 has changed. It provides for enforcement of commercial settlements reached in international mediation viz between parties from different countries as per the Singapore Convention on Mediation to which India was a notable signatory. The Convention assures disputants that their mediation settlements will be enforced without much difficulty across the world, unlike the fresh headaches that the litigative decree or arbitration award present at the time of enforcement.

The bad

Leading in from the last point, it is expected that this Bill would make India a hub for international mediation in the commercial disputes field, and indeed institutions are being opened for this purpose. Exactly the reverse may happen. This is because the Bill unwisely treats international mediation when conducted in India as a domestic mediation. The settlement under the latter is given the status of a judgment or decree of a court. Now, that is excellent for cases between Indian parties, but disastrous when one party is foreign. The reason is that the Singapore Convention does not apply to settlements which already have the status of a judgment or decree. Ergo, if you conduct your cross-border mediation in India, you lose out on the tremendous benefits of worldwide enforceability. In sum, go to Singapore or Sri Lanka or anywhere else other than India to conduct your mediation. If this drafting mismatch is not remedied, dreams of our robust hubs and ease of doing business in India are neatly nipped in the bud.

Then comes the governing mechanism, the Council. It has three members: a retired senior judge, a person with experience of Alternative Dispute Resolution (ADR) law and an academic who has taught ADR. This is an all-powerful body which regulates, certifies, accredits, plans, governs, etc., and it doesn’t have a single mediator. Judging from the fact that these are full-time members, it is clear that none of them will be active practitioners. Most likely we are looking at sinecures for the bureaucratic and academic world. Certainly this Bill will be unique where a profession is being regulated without a single professional on the regulator. Try doing that to lawyers, doctors and accountants. And one more lapse — this is the field of dispute resolution, the judiciary’s domain, so how come the Chief Justice of India is not in the picture for making appointments?

Then there is a long list of disputes which should not be mediated. Some of them look understandable at first sight but unnecessary at second. Fraud, for example. It is standard practice in litigation to make as many and as serious charges as possible; that doesn’t prevent parties from settling, and these accusations are disposed of by retraction or apology or simply ignored. In cases involving minors or persons of unsound mind, the law provides for the court to pass orders to protect them. All that is necessary is to provide that any settlement of disputes involving them needs the court’s approval, not to deny the possibility of a beneficial mediated settlement. Patents and copyright cases settle on commercial terms leaving untouched the validity of the grant, so why deny this possibility and consign the parties to litigative longevity? In the case of telecom, why can’t manufacturers and service providers and consumers be allowed to talk and resolve issues?

The sad

Why can’t we get our act together to get the Mediation Bill in good shape? Why can’t all the stakeholders get this Bill together? Mediators, lawyers, judges have applied their minds to a considerable degree. To be fair to the government, it did call for comments on the draft Bill. What is missing is the element of focused and engaged discussion after comments are sent. It is as though a wall has been erected and no one knows what is going to emerge. We all have a common purpose: to place mediation strongly in our legal landscape, and place India prominently in the world’s mediation landscape. Even if it takes more discussion and consideration amongst all stakeholders, let that be done. It is for Parliament now to do the needful. We should not settle for less.

Sriram Panchu is Senior Advocate and President, Mediators India. Email:

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